Construction Law Toolbox

When Enough is Enough and Justifies Termination

A question frequently asked by owners and contractors is when enough is enough and termination is justified. As a preliminary matter, immediate termination for a non-compliant contractor or subcontractor is never a good idea. Mississippi jurisprudence requires that notice (preferably in writing) should be given to the non-compliant party with an opportunity to cure the alleged defect. The decision to terminate is never easy and viewed by the court as an extreme remedy. Nonetheless, the court has also recognized that termination may be warranted where repeated attempts to cure have been ineffective.

Any notice of termination should be in writing identifying the "material breach" justifying the termination and entitlement to damages associated with completing the terminated scope of work. The owner or contractor should also secure a number of quotes/prices to complete the work. This will assist the owner or contractor from being accused of securing an unreasonable or excessive price to complete the terminated scope of work. Remember, any change in the original scope of work or "betterment" could be grounds for the terminated party to challenge all or a portion of the claimed damages.

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Biggs, Ingram & Solop, PLLC
Jackson
111 E. Capitol Street, Suite 101
Jackson, Mississippi 39201